Regular readers are familiar with my “ice-nine” thesis on how the next financial crisis will play out. Ice-nine is a phrase invented by Kurt Vonnegut Jr. in his novel Cat’s Cradle.

In the novel, ice-nine is a doomsday device involving a molecule that freezes any water it comes in contact with and converts that water into ice-nine. Once released into a body of water, ice-nine eventually freezes all the water on Earth and causes the extinction of mankind.

I used ice-nine as a metaphor for a total freeze of bank and brokerage accounts in a new panic. This is explained in my book The Road to Ruin. Now, a real-life version of ice-nine is playing out in the gold market.

As explained in this article, Venezuela stores some of its gold bullion in vaults at the Bank of England in London. Venezuela has requested that the gold be returned to Venezuela, probably so that it can be pledged to China or Russia for financial assistance. But the Bank of England is freezing Venezuela’s gold and refusing to return it.

For now, Venezuela is the victim of this ice-nine account freeze. But in the not-distant future, it could be your bank or brokerage account that is frozen in a financial panic.

The best advice is to keep some physical cash on hand and store your gold or silver in safe nonbank vaults. Only by escaping the government-controlled banking system can you escape ice-nine.

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